The latest data on US inflation has revealed a modest uptick in the annual rate for July, signaling a halt to a year-long trend of decreases driven by base effects. The Consumer Price Index (CPI) climbed to 3.2 percent for the 12 months ending in July, up from the previous month's 3 percent but slightly below expectations of 3.3 percent. This marks a pivotal point in the trajectory of the country's economic recovery.
The rise in inflation figure, which was driven by higher food, housing and car insurance costs, strengthened the case for the US Federal Reserve to hold interest rates steady at its next meeting in September this year.
While the increase was within the anticipated range, the monthly inflation rate for July mirrored that of June, with both months registering a 0.2 percent uptick, the Bureau of Labor Statistics reported on Thursday (August 10).
July's core inflation rate clocked in at 0.2 percent month-on-month, consistent with both the previous month and market projections. However, the year-on-year core inflation rate eased slightly to 4.7 percent, down from June's 4.8 percent and falling shy of the anticipated 4.8 percent.
The energy index has witnessed a noteworthy contraction, plummeting by 12.5 percent for the 12 months ending in July. In contrast, the food index has surged, notching a 4.9 percent increase over the past year.
First Published: Aug 10, 2023 6:52 PM IST
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